Jake and Nog, on a visit to Ferenginar, find themselves on board a rogue starship, piloted by a fresh-faced crew of Starfleet cadets. But these aren't just any cadets, they're Red Squad cadets: the best of the best. Their loyalty and obedience eventually lead them into disaster.

While en route to Ferenginar in a runabout, Jake Sisko and Ensign Nog are attacked by a Jem'Hadar vessel, but are rescued by the USS Valiant, a Defiant-class starship. Jake and Nog find that the crew are all young members of the Red Squad, the brightest Starfleet cadets, originally part of a more experienced crew that was on a training mission to circumnavigate the Federation prior to the all-out war. However, the Valiant suffered heavy losses including all of the experienced crew, and the late Captain transferred command to now-acting Captain Tim Watters. Watters has continued to follow their last directive without any further orders from Starfleet, and has recently learned of a new Dominion battle cruiser. Nog is quickly integrated into Red Squad and the ship's engineering staff with his knowledge of the Defiant warp system, but Jake is seen as an outsider. When Jake attempts to talk to Chief Collins about her personal life, she breaks down emotionally, and Watters orders Jake not to talk to her further.

Watters reveals that they have located the battle cruiser and orders the ship to approach it, raising the crew's morale to levels Jake fears are irrational. Jake believes that Watters is actually on a suicide mission, warning Nog and Collins of the danger. Watters learns of this, and has Jake thrown in the brig. The crew of the Valiant is able to successfully scan the battle cruiser and discover a possible weak point. Watters orders the crew to attack the vessel, but they find they have made a major miscalculation as the vessel remains undamaged. The Valiant is assaulted by the battle cruiser's weapons, critically damaging the ship and killing much of the remaining crew. Nog grabs Collins and frees Jake, and then departs with them on an escape pod before the Valiant explodes. The three are eventually rescued by the Defiant, learning they are the sole survivors and leaving them emotionally scarred from the trauma. Nog pronounces that the Valiant was a good ship with a good crew, whose only mistake was blindly following Watters's disastrous orders. Despite pleas from Collins that Watters was a great man, Nog replies "[h]e may have been a hero, he may even have been a great man, but in the end, he was a bad Captain."

Red Squad, an elite team of Starfleet Academy cadets, was first seen in the fourth-season two-parter 'Homefront/Paradise Lost'; in those episodes, they sabotaged Earth's power-grid in an attempted coup d'état by a Starfleet Admiral. Nog had previously expressed an intense desire to join Red Squad.

Cadet Riley Aldrin Shepard, who served as helmsman on the Valiant, confessed to Captain Sisko in 'Homefront/Paradise Lost' (about two years prior) that he had taken part in the operation to sabotage Earth's power grid as part of a failed coup attempt. In that same episode, Sisko subsequently commented to Odo that he had just "admitted to committing acts of treason against the Federation." However, for reasons that were never explained in the series, Sheperd evidently was not expelled from the academy or from Red Squad.